Fiscal conservatism used to be about balancing the budget and running a tight ship. Now it’s about keeping taxes low no matter what. But this is well-trod ground. What’s bothered me lately is that I just don’t really understand why fiscal conservatism is so trendy now in the first place. For instance, here’s Andrew Sullivan complaining that Obama is not enough of a deficit hawk:

To coin a phrase, how long, O Lord, how long? We have a divided government, we just had an election in which one side campaigned on too much spending, we have a very pragmatic president able to explain the dangers we face, and a debt that grows every day. But nooo. Let’s get the GOP to lead.

And let’s not fool ourselves. The president has just asked the opposition to do his work for him. He should be careful what he asks for. If the GOP actually proposes cuts in Medicare, real tax reform, and some of the proposals in the Bowles-Simpson report, there will be many independents and fiscal conservatives who will take a second look.

What’s troubling to me about this is that I’m not sure Sullivan has made much of a case for entitlement reform or fiscal conservatism to begin with. It all feels very much like intuition. In fact, I’m not sure anyone claiming to be a fiscal conservative has made that case. The notion that we need to balance the budget and pay down the debt right now is just taken for granted with no real attempt to explain why.

Is inflation out of control? No, not even close. Are our creditors closing our accounts? No, because our creditors know that all we need to do to pay them off is raise taxes or get out of this recession. When growth picks back up deficits will shrink. The deficit is not a problemin the first place. The whole thing is just a ruse.

Meanwhile, unemployment remains sky-high and so do corporate profits. Everything is rosy except for the American worker, and to them fiscal conservatives and pundits like Sullivan say “Austerity Now” like some grotesque mimicry of that Seinfeld episode. All the hand-wringing over structural unemployment and so forth is just cover for supply-side nonsense that’s captured the American psyche from pundit and politician on down. What we are witnessing is a balance-sheet recession and a crisis of demand. Or at least that’s what all the evidence and data points to.

But it’s easier for people who do not have to cash an unemployment check or who will never rely on Social Security to say that what we need now is actually entitlement reform, austerity, and – of course – more tax cuts for corporations and the wealthiest Americans. And we need to stop handing out those unemployment checks too, because why would anyone work if they could just collect a couple hundred bucks free of charge? This is fiscal conservatism. No tax increases allowed. At least Sullivan argues for those (which is enough to write him out of most conservative circles) but for the life of me, I can’t recall ever reading anything he’s written that clearly explains why he’s a fiscal conservative to begin with and, just as importantly, why he thinks now is the appropriate time for us to cut spending and raise the retirement age, or focus on the deficit rather than on jobs.

This could be because Sullivan is only reacting to an appealing narrative about the debt, one which deficit hawks have been working hard to craft over the past two years in order to kill the stimulus and weaken the Obama administration; or it could be because there is no good reason for austerity-now politics in the middle of a demand-side recession where inflation is low and unemployment is high and corporations and banks are sitting on vast piles of cash and not hiring and not spending.

There is a very good reason to take a look at the Big Picture and ask why corporate America is rebounding and the working class is not. I imagine the answer to that riddle will not be the national debt, or Obama’s inability to govern exactly how Andrew Sullivan thinks he ought to govern. Obama may not be the progressive many hoped for and he may not be the socialist bogeyman that many pretend he is, but he’s not a Republican deficit hawk either no matter how much he panders to them. He is not asking “the opposition to do his work for him” he’s playing politics. It’s weird that anyone would be fooled into thinking Obama is actually a fiscal conservative just because he’s cut a few programs and tossed a few bones to the dogs (though why he’s tossing them bones to begin with when nothing will satisfy them is also beyond me).

https://www.balloon-juice.com/wp-content/uploads/2015/11/balloon_juice_header_logo_grey.jpg00Erik Kainhttps://www.balloon-juice.com/wp-content/uploads/2015/11/balloon_juice_header_logo_grey.jpgErik Kain2011-02-16 14:34:232011-02-16 14:34:23I do not think that word means what you think it means.

What irks me most is that the obvious problem with entitlements is rising health care costs. ACA doesn’t do *nearly* enough to deal with them, but it is a step in the right direction, and Obama put himself on the line politically to get it through. But all these deficit hawks don’t give a damn about that. The myopia is amazing.

What’s troubling to me about this is that I’m not sure Sullivan has made much of a case for entitlement reform or fiscal conservatism to begin with.

That’s because Sullivan exists in a place of eternal moral high dudgeon. He’s incapable of viewing even a pragmatic policy dispute outside of a cataclysmic moralistic lens. Debt is Bad, therefore we must Reduce the Deficit. The real effects of that policy don’t matter if it works towards The Ultimate Good of Deficit Reduction.

This is a fine intellectual framework if you’re looking for universal denunciations of torture or kicking puppies or something, but not so much if what you want is a pragmatic response to a very real dilemma between something that is important in the long-term (debt reduction) and something that is catastrophic in the near-term (slashing social services in the middle of the worst economy in 80 years).

What’s bothered me lately is that I just don’t really understand why fiscal conservatism is so trendy now in the first place.

Because it’s the way our wealthy, bought-and-paid-for GOP politicians can look like they give a fuck about their constituents and their suffering without actually having to give up any economic privilege. And it”s the opposite of what the Democrats want, so it is therefore fucking awesome.

Why on earth is it Obama’s job to do the GOP’s job for them? They campaigned on cutting services, cutting taxes, and the deficit. Let them do what they want. Why do they require Obama’s leadership (which he’s all too ready to give them?). So what if “independents and conservatives take another look?” If Sully really wants that fiscally tight ship he should hope that independents and conservatives keep voting for the people who will bring it into being. I, for one, hope they take a closer look at the whole thing and eventually realize they are being fucked over, big time.

Perhaps we are seeing it in a microcosm in Wisconsin with the draconian attacks on public servants–but we’ll see. At least in Florida, so far, the comments on the Rick Scott Kills Train threads are chillingly stupid.

So the answer, not to beat a dead horse, is that Sullivan and his underlings really are useful idiots for the cons. The fact that they each woke up and stopped being useful idiots on one issue does not mean that they’re not still being useful idiots about everything else.

I think you guys are spending waaay too much time reading Andrew Sullivan. 99.9% of the public likely has no idea who he is and could care less what he says. They like “fiscal conservatism” because they don’t want to pay taxes. It’s really that simple. (Notice, I didn’t say fiscal responsibility because they are far from responsible)They don’t care what happens to anyone else as long as they don’t have to pay for it.

My advice to you is to spend more time with real reporters, who report real news and less time with the beltway insiders who’s whole purpose in life is to avoid paying taxes. Andrew Sullivan is irrelevant.

@DougJ®: Also too, it’s deeply dishonest to talk about “entitlements,” and “SocialSecurityAndMedicare,” when SS in in very sound shape, and the entire problem with Medicare is, as you point out, the insane, US-only explosion in health care costs. And when we try to address that, we get chants of socialism and death panels from every single Republican officeholder.

A fine post, EDK, thanks. Sully has never shown his work, nor hinted at why he’s so hopped up about this right now.

Incidentally, balancing the budget isn’t that hard. Dial down an occupation or two, restore taxes to 1990s levels, and we’re almost there. See here.

it is just a ruse. it’s a ruse that happens to (completely coincidentally, i’m sure) line up perfectly with the boilerplate criticisms the GOP makes every time a Democrat becomes President. this time, the GOP was able to turn that boilerplate into electoral gold thanks to the dumb-ass Teatards and the MSM’s fascination with them. they took their grade-school economic theories and understanding of the Constitution and whipped themselves into a lather over their own imaginary monsters.

but there is no real crisis. everybody knows it except those who are fiscally-paranoid-conservative by nature and those who just don’t know WTF they’re talking about (the hordes of Teabagger parrots). this is why the official GOP is being cowardly about proposing real cuts, and it’s why Obama is being careful to avoid proposing anything substantial. they all know it’s a ruse, but it’s one the public has fallen for. and they know that you can never win by telling people they’re dumb, and you can’t win by cutting entitlements. so, they dance.

The notion that we need to balance the budget and pay down the debt right now is just taken for granted with no real attempt to explain why.

Well, pardon my blogwhore, but I already addressed that issue today. Just a few years ago you had conservatives like the august Irwin Seltzer talking about how Bush’s deficits actually stimulated the economy. He called Bush’s deficits “a force for economic good.”

So really, ED, what we are left to surmise from all of this is that the deficits hawks are intellectually and morally bankrupt. I’m sorry to break the news to you but that appears to be the way it is. That goes for Sully and everyone else who claims we have to fix the deficit right now!

What else can one conclude when a deficit under a Republican president is “a force for economic good” but one under a Democratic president is worse than tyranny? I mean, come on. Let’s just call it like we see it here.

Of course thirty years of stagnant wages (Actually retrograde in 2000-2010) have nothing to do with revenues. Ten years of war, most of it off-budget had no effect either. It’s all the fault of those young bucks demanding t-bone steaks.

(reposted w/o link to substantiate final paragraph in order to avoid moderation)

@DougJ®: Also too, it’s deeply dishonest to talk about “entitlements,” and “SocialSecurityAndMedicare,” when SS in in very sound shape, and the entire problem with Medicare is, as you point out, the insane, US-only explosion in health care costs. And when we try to address that, we get chants of socialism and death panels from every single Republican officeholder.

A fine post, EDK, thanks. Sully has never shown his work, nor hinted at why he’s so hopped up about this right now.

Incidentally, balancing the budget isn’t that hard. Dial down an occupation or two, restore taxes to 1990s levels, and we’re almost there.

The Republicans and Corporate Democrats realize that if we do engage in the ACTUAL problems that you laid out, the public will like it, they will vote for jobs and health care-control policies, and the corporate gravy train will begin to dry up. To acknowledge that liberal policies work for people is to begin the end of the oligarchy.

I really hate to put it in these terms because it is fraught with homophobic connotations that I certainly don’t intend but the short answer is that Sully is a pre-adolescent drama queen.

If Sullivan gets upset, you can always issue a non-apology apology with a version of Sullivan’s famous “unretraction”* of his vile “fifth column” slur:

“By pre-adolescent drama queen, I meant simply his ambivalence about the outcome of an economic war against the middle and working classes on which I believe the future of liberty hangs. Again, I retract nothing. But I am sorry that one sentence was not written more clearly to dispel any and all such doubts about its meaning. Writing a short blog comment in the heat of economic war can lead to occasional sentences whose meaning is open to misinterpretation.”

See? All better!

* By fifth column, I meant simply their ambivalence about the outcome of a war on which I believe the future of liberty hangs. Again, I retract nothing. But I am sorry that one sentence was not written more clearly to dispel any and all such doubts about its meaning. Writing 6,000 words under deadline in the heat of war can lead to occasional sentences whose meaning is open to misinterpretation.

Has Obama cut the deficit yet? Crisis! The country’s going bankrupt tomorrow if Obama doesn’t act NOW to eliminate the debt! Hyperinflation! Out of control spending! Entitlements! Obama promised to eliminate entitlements and now he’s not doing a thing!

@DougJ®: Krugman passes on Jonathan Bernstein practically begging to get people to say “Medicare and Medicaid” instead of “entitlements” because of the implication that Social Security is included in entitlements.

Fiscal conservatism used to be about balancing the budget and running a tight ship.

Really? When? Can you cite a time in your lifetime when conservatives ever worried about balancing the budget or running a tight ship? Eisenhower maybe but since then, the closest you get is Bill Clinton. Of course, he also signed the CFMA and Gramm Leach Bliley so I’d hold off on giving him a medal. (Although in fairness, Bush 41 did raise taxes to address the deficit left by Reagan and you could make a case that this helped pave the way for the 90’s boom.)

There is a very good reason to take a look at the Big Picture and ask why corporate America is rebounding and the working class is not.

You want to know why? Look at recent historical trends in income disparity and that will give you a clue. If, in the early 1970’s the upper 1% controlled 9% of all wealth and today controls over 30% (pulling these numbers from memory but I think they are close to correct), that would seem to me to be a significant part of the problem. The working class can barely make it from paycheck to paycheck and does not have the revenue to stimulate the economy through spending. (This harkens back to the explanation of why extending benefits to the long term unemployed are more stimulative than tax cuts for the upper 2% of wage earners.)

I’d direct you back to the link to the vid clip of Dr. Jeffrey Sachs posted by Doug J this morning. The Democrats and the Republicans are wholly owned subsidiaries of the special interests who finance their election campaigns and are not that motivated to deal with our economic conundrum. But Dr. Sachs provides some great suggestions:
1. Restructure the tax code so that millionaires and billionaires pay a higher rate than currently.
2. Address rising healthcare costs caused by our incredibly inefficient system. (Useful prescriptives have been offered by Dr. Atul Gawande and others.)
3. Reign in defense spending.

I don’t want to implicitly go Godwin here. So I won’t use the term Big Lie. I will just call it a big lie instead.

It amazes me that the media is so forcefully pushing the big lie that Social Security is related to the current budget deficit. Social Security is currently running a surplus, and will continue to do so for another five years.

The only relationship between Social Security and the deficit is that the government will soon have to pay back the money it borrowed from the Social Security trust fund, and that may impact the after tax income of wealthy people.

So, you get a big lie, you get endless gibberish about how this debt is not really a debt like other debt, the trust fund doesn’t really exist, even though the purchasing power that current workers gave up to build up the trust fund certainty is real and does exist.

You get supposed reporters in Presidential press conferences asserting that the worthless debt commission said that ‘fixing’ Social Security is important for deficit reduction, when the reports explicitly said that was not true, and that the commission took on Social Security merely because they felt like doing so.

You get corporations that want low inflation or even deflation and low interest rates for their own quasi rent seeking purposes and to aid them in making a pile of money from the fight over profiting in the legal and political battle over the mortgage crisis debt.

The evidence is that misinformation is being spread so certain wealthy and powerful economic sectors can make a pile of money through rent seeking and appropriation of any economic surplus they see lying around by any means necessary.

This is a discouraging diagnosis that I wish were not true, because it is evidence of a perhaps fatal level of corruption in our society. It hints of the dreary possibility of an era that is an endless 1939, except with more corruption and more crony capitalism.

Fiscal conservatism used to be about balancing the budget and running a tight ship. Now it’s about keeping taxes low no matter what. … I just don’t really understand why fiscal conservatism is so trendy now in the first place.

Fiscal conservatism has always been about lower taxes no matter what. It’s only now, when there’s nothing but bone left to cut into, that the no matter what part is becoming self-evident to even those longtime fiscal conservatives who actually believed the propaganda that it was about balancing the budget.

Sorry if that hits a little close to the bone, but, as noted above, there’s no where else left to go.

@DougJ®: Exactly. And the thing about healthcare costs is that if they keep rising at the rate they have been, the deficit is going to be the least of our worries–trivial compared to the overall economic (and human) catastrophe caused by out-of-control healthcare costs.

(To be clear, though, a lot of measures that are likely to help control costs weren’t scored as such by the CBO, because the savings are potential and speculative. So ACA may well end up doing much, much more to control healthcare costs–and thus Medicare costs, and thus the deficit–than the CBO score indicates.)

Sullivan can always be counted on to be a hysterical polemicist about virtually anything. Capable of moving from non sequitor to another in quick step. He was that way at TNR and as a war blogger.

On this he just magnifies the hysteria of the must cut deficit NOW! crowd with no thought to whether that’s the right question, nor whether it is the right means. The right question is obviously – how do we re-build a strong economy that provides for most Americans?

My favorite proxy for Sully is Niall Ferguson – similar – who must take care of my pet peeve NOW! or your EVIL!

This could be because Sullivan is only reacting to an appealing narrative about the debt, one which deficit hawks have been working hard to craft over the past two years in order to kill the stimulus and weaken the Obama administration;

Jeez, I just don’t know how to take you sometimes E.D. This quote just sort of encapsulates the difficulty I’m having.

First, you rattle off a bunch of sensible, sane points that obviously indicate that you have a grasp on reality and that you don’t deny empirically derived facts and evidence and then this statement.

For Pete’s sake, man, your statement above is the entire, delusional premise of the conservative movement since Ronald Raygun. That “appealing narrative” about the debt has been squawked about ad nauseum ever since Reagan while at the same goddamn time, “Conservative deficit hawks” spent money like a bunch of goddamned drunken-ass sailors on shore leave.

[…] ED Kain: Is inflation out of control? No, not even close. Are our creditors closing our accounts? No, because our creditors know that all we need to do to pay them off is raise taxes or get out of this recession. When growth picks back up deficits will shrink. The deficit is not a problem in the first place. The whole thing is just a ruse. […]

Tell me, how many corporations go without debt? How many households pay for their houses or cars with cash?

And yet simplistically, we’re to believe that running the government like a business is what we should *aim* for – “balanced budgets are needed!”

Debt is a useful tool to maximize returns. It’s called leverage. People use it when buying a home, corporations use it when issuing debt, and they get sued for business malfeasance if they don’t – because they’re not maximizing shareholder returns.

I haven’t set foot across the Florida state line since I saw a pickup truck with “Nuke The Ragheads” spray painted on its side in 2003. That was the last straw for me. Won’t be back. Sorry assholes, I’ll take my vacation dollars somewhere more progressive.

What irks me most is that the obvious problem with entitlements is rising health careis revenue, not costs.

Yes, there are problems with rising health costs, but if you make the problems about that, then Republicans will simply argue that it means Medicaid and Medicare are unsustainable and we must repeal them.

The biggest problem right now is that tax revenues are down, because unemployment is over 9% and the tax rates on the rich are the lowest since before WWII — while their profits are simultaneously the highest ever. Fix that first, then take a second swing at the ACA and lowering health care costs.

I’ll be accused of fomenting class warfare, but it’s all about the privileged classes stealing everything that isn’t bolted down. Cutting taxes on capital gains is a huge benefit for only the wealthy (and notice how all us “little people” paying into non-Roth IRAs are going to get a higher tax burden at retirement than the billion-dollar-per-year fund managers). Cutting the top tax bracket from 70%->50%->35% (with a few years at 28%!!) has the same effect.

I think we can define this pretty easily, here and here. Just replace “poor” with “middle class” and the sentiment holds up.

From what I’ve read the majority do not even understand how a nation’s economy needs to be maintained in order flourish. They just repeat the same globblie gook slogans that have been floating around for decades without even understanding what they are saying. Few of them can even bring themselves to admit that there are more people involved in an economy than just the executives and major investors.

Fantastic post. I particularly love the hysteric comparisons that Sulli has been making to Greece. I come from a region that had a Debt Crisis in the 80s and a default. Sulli has no fucking clue what he is talking about, yet he spouts as if he had a PhD in Econ instead of political theory.

I can’t explain why Andrew and his ilk treat the deficit as a crisis that must be dealt with NOW rather than a problem that could be fixed in the near term future. I also don’t understand why it’s cuts to spending that get all the pub when tax rates are at their lowest levels since the Truman administration. It’s obvious we could tax our way out of our current situation without any real pain by establishing higher tax brackes above the current top rate at $250K.

I can tell you why Obama won’t “lead” on this issue. He just spent a bunch of political capital fighting for a new health care bill that attempted to modestly control the rise in health care costs. Instead of being fiscal conservatives and having his back on cost containment, the republicans screamed death panels and scared seniors by saying he was gutting medicare. So if they want real cuts to medicare or other government services, let them go ahead, because they’ll be leading with their chins.

Man – what a timely thread and great comments. Sully’s a rich, white, spoiled non-manual laboring writer – what he says about entitlement programs only betrays his lack of understanding for their need and personal bias. The solutions aren’t that complicated:

1) Social Security – don’t raise the retirement age, don’t means test, and don’t reduce benefits. Eliminate the wage cap, or create a donut-hole where those earning more than $250k contribute on income above that amount. Problem solved, and the program keeps benefiting everyone in perpetuity. You might even be able to raise benefits!

2) Military – slowly cut spending to about 1/2 current levels (slowly b/c there are a lot of jobs dependent on this and you don’t want to kill the recovery) – focusing first on killing the big weapons and carrier programs that aren’t needed. Big deficit savings there.

3) General fiscal deficits – raise taxes on those earning more than $250k. Cap gains back up to 25%. Close the hedge fund carried interest loophole. Lower corporate rates + get rid of deductions/loopholes. Institute a financial transactions tax. Lower leverage limits. Regulate CDSs and other derivatives.

4) Medicare/Medicaid – Federalize Medicaid. Allow anyone to buy into Medicare as the “public option”. Then the hard work begins (b/c it’s all about which services we pay for).

If I wanted to “fantasize” I’d just say get rid of Medicaid, get rid of private insurance, Medicare for all becomes single payer. That’d solve like 50% of the problems right there and then it’d be a more general discussion about the tough choices with what’s covered/not.

None of these would kill the economy one whit. They’d address income inequality, strengthen the safety net and probably actually increase GDP as the vast majority of consumers would be more able to spend.

Andrew can’t see the alternatives because he’s still a conservative Brit and any gov’t intervention looks like communism to him (btw – his beloved British conservatives are busy being “serious” and creating a double-dip recession).

Nearly every problem we face now requires gov’t intervention to solve (too low tax revenues for service levels, too little regulation on energy/financial sectors). Andrew is about as useful on this topic as I am on 17th century slovenian literature.

@E.D. Kain: Fair enough. But the problem still remains: For the most part, the politicians and policy makers are making straw man arguments and then legislating on the basis of what most benefits the special interests who own them. Actually addressing the problems that exist in our fiscal/economic policy–i.e. being fiscally responsible–is a pretty low priority as far as I can tell. And that holds true for both parties even though I believe the Republicans are both more dishonest and more disingenuous about their positions.

So if they want real cuts to medicare or other government services, let them go ahead, because they’ll be leading with their chins.

I doubt that their voters (Particularly the teabaggers) actually understand the outcomes if Medicare, SS and other government services are cut. They all “know” that good people like them won’t be affected, it will only be the lazy bums and the welfare queens.

One of my hobby horses in comments is that ‘somebuddy otta make a list’ and use to pound the media.

I would do these lists, but I have day job, though if anyone is willing to pay me, maybe we could do a deal.

My request of the day for a useful list:

Somebody otta keep track of the senseless contradictions of the GOP on the economy. Latest one is Boehner saying that the cuts may well cost jobs and he didn’t care. What happened to wasteful government spending being the curse that wrecked the recovery? What happened to the Bush tax cuts (which remain in place) being the cure to all ills. (Edit:) Or the idea that deficits and the debt were the looming threat that explained the lack of a strong recovery? Where did the bond vigilantes go? Won’t they ride in to reward our new virtue? Or not?

How can people not laugh in disgusted amusement at the combination of stupidity, dishonesty, and desperation?

How can people not feel disgust at the our worthless national affairs media who play along with the charade that the GOP makes one single lick of sense on anything at all regarding economics.

Somebody otta make a list and use to try to shame some reporters and politicians. Probably won’t work, but at least the attempt would have been made.

[…] have a tendency to flail a bit, though, without seeming grounded. E.D. Kain, over at balloonjuice, makes most of the case for me: What’s troubling to me about this is that I’m not sure Sullivan has made much of a case […]

Republicans are only fiscally conservative when it comes to spending money on things that help the most people. When it comes to their priorities, there is always money available to help the rich few or to start a war.

3) General fiscal deficits – raise taxes on those earning more than $250k. Cap gains back up to 25%. Close the hedge fund carried interest loophole. Lower corporate rates + get rid of deductions/loopholes.

Robert Reich offered a great suggestion here. Simplify the code by eliminating deductions and loopholes. And add higher marginal rates on higher income levels. For example: 30% on income over 250K. 35% on income over 500K. 40% on income over a million. 50% on income over 5 million. Etc.
For my money, I’d treat all income as income regardless of source and tax it accordingly. Interest, dividends, cap gains, whatever. Maybe allow a cap gain allowance on gains selling your primary residence provided that those gains are used to help pay for a new primary residence. But that’s about it.

It’s shocking to me that people like sullivan are advocating for cutting social security. The program ran a profit for almost all of its existence, and is still running a profit today. Those excess social security taxes paid for things like the Iraq invasion and the Bush Tax cuts. And yet the moment social security taxes no longer provide this excess revenue, we must somehow slash benefits by raising retirement age? And these are guys who always argue shit from a moral perspective.

It’s bullshit that sullivan would argue we are screwing over our grandkids by not slashing entitlements. Who does he think is going to suffer those reduced benefits?

E.D. Kain: By the way, I should add, in addition to my criticisms above, that I do like and agree with the main thrust of this post and most of the points you make.

It’s just that it’s a pet peeve of mine when I see the past 30 years of Republican “fiscal conservatism” described as anything other than the reckless lie, and obvious myth, it’s been ever since Reagan was pushing for lower taxes while quadrupling the national debt.

And the phrase “fiscal conservative” is a dog whistle. It’s largely been used by people who are largely opposed to any kind of social program except the most basic, which is why you see square state Dems using it.

@RosiesDad: I saw his article. You don’t even have to go to the high levels of 50%+ to get serious benefit. And I’d agree with you. At an individual level if you treated all income the same and added a few higher marginal tax rates, it’d go a long way.

There’s plenty else to sneer at in Sullivan’s post — and to admire in E. D. Kain’s response — but I wanted to highlight this part of Sullivan’s rant that no one else seems to be referencing:

“If the GOP actually proposes cuts in Medicare, real tax reform, and some of the proposals in the Bowles-Simpson report, there will be many independents and fiscal conservatives who will take a second look.”

Is he delusional? Any party that does those things he mentions is asking to be wiped out at the polls. (Cf.: all political history) So add political tone-deafness to Sullivan’s many other faults.

At the moment, for Sullivan, a serious person on fiscal issues is anyone who thinks we should implement Simpson/Bowles post-haste (whatever that means; there are several different plans). Have a problem with the fact that the most commonly discussed plan raises taxes more for the bottom 3 quintiles than the top quintile? You’re not conservative!

On the other hand, he’s praised Coburn as a serious voice on the debt. Coburn, who, as a doctor, has been most influential in healthcare legislation. In this role, he’s repeatedly argued for tort reform as a debt-reducing measure and argued against anything that reduces healthcare costs without reducing quality (ie anything that moves towards nationalization). You might agree with Coburn’s positions on some sort of moral basis (it’s unfair to put insurers & providers out of business). Fair enough. But he regularly engages in outright lies about economic disadvantages of national healthcare, the relative quality of US/Canadian/UK care, etc.

The reason we hear so much fear mongering about the govt debt right now is that deflationists are in the saddle and ready to ride roughshod over the rest of us. Deflation is a well honed tool of economic warfare that asset holders use to keep everyone else who isn’t an asset holder struggling and in a continual state of debt. Govt borrowing is a threat to this system because a legitimate and trustworthy govt can borrow at much lower rates than the average person and as as consequence any govt program which is funded in this manner and which puts money into the pockets of average people offers an escape from the deflationary trap. And we can’t have that now, can we?

about this, yes. he seems to think there’s a constituency for actual, real-life, non-imaginary deficit cutting out there who will be so impressed by the Seriousness of the kind of proposals that budget hawks fantasize about that they will just cinch up their belts and nod sagely at the bold, serious wisdom. a great, vast, currently un-represented constituency of stoic, steel-jawed, self-reliant, common-sense-worshiping penny-pinchers who are just waiting to be told “no, you can not haz.”

I’m not sure why Sullivan likes Ryan’s plan so much. I just listened to an interview with Sen. Conrad, head of the budget committee, who said Ryan’s plan would take 53 years to balance budget. What kind of fiscal conservative would think that was a good idea?

I just don’t understand how cutting expenses while simultaneously reducing revenues is going to make trillions disappear.

@JGabriel: like I said I’m in no way wed to the term fiscal conservative. I think you’re entirely correct in your critique. I’m just focusing on the current anti stimulus and anti spending hyperbole and how that is associated with current unemployment. That’s all.

@RosiesDad: “Maybe allow a cap gain allowance on gains selling your primary residence provided that those gains are used to help pay for a new primary residence.”

And there is the slippery slope. How about income when life insurance pays off? Life insurance of a soldier who died in the line of duty saving a child from terrorists?
And it is an adorable blonde child? Huh? what then?

Once you get an allowance for life insurance death benefits, inherited wealth will also no longer be treated as simple income.

Doop de doo, strollin along, SULLIVAN IS AN IDIOT, sup sup, what what. Also, too, he periodically has these major “conversions” to non-idiocy, where it’s like, “Oh wow, something in front of my nose that I struggled to see, like torture is wrong. I’m freakin Orwell over here!” I wish he would find a memory hole and flush himself.

What was the conservative mantra during the recent debt laden Bush years? Oh yeah, “Reagan taught us that deficits don’t matter” – Dick Cheney. Or how about this 2004 American Spectator article entitled Deficits Don’t Matter

I can’t believe that I am writing about budget deficits again. The Bush Administration’s $520 billion deficit forecast for this year doesn’t bother me, but the deficit phobia and media outcry is getting tiresome. I thought this had been resolved and agree with Vice President Cheney, who reportedly told Paul O’Neill, “Reagan proved that deficits don’t matter.” He was right.

I was always a little skeptical of the original thesis of disaster capitalism/Shock Doctrine, but recent events demonstrated it in spades. Our economy crashes because of unregulated craziness in the financial markets – which can be attributed to core conservative doctrine (aided and abetted by Clinton). Financial crisis is now allegedly grounds for stripping away the liberal programs of the US government, in the guise of financial austerity to avoid the alleged horrible implications of deficit spending.

The fact that any party that takes the lead in stealing the people’s money under the slogan of ‘Entitlement Reform’ will take a serious political hit, is precisely why the GOP leadership has been baiting Obama about not ‘taking the lead’ in their bogus deficit reduction campaign.

One would have to be childish and simple minded or corrupt to tolerate such grade school tactics, so of course the corporate media loves it (from what I have seen and heard so far).

Obama is dong some kind of rhetorical dance of the seven veils around it, for what I hope are good reasons.

Frankly, anytime Sullivan actually responds to something he’s done that is truly reprehensible (5th column, role in “The Bell Curve”, etc), he actually make me angrier about it than I would be if he just ignored criticism. His mea culpas tend to be heavy on the mea and light on the culpa.

He is not asking “the opposition to do his work for him” he’s playing politics. It’s weird that anyone would be fooled into thinking Obama is actually a fiscal conservative just because he’s cut a few programs and tossed a few bones to the dogs (though why he’s tossing them bones to begin with when nothing will satisfy them is also beyond me).

Like you said, playing politics. When the GOP inevitably flips out and concedes not an inch, Obama will again look like the only adult in the room, being the only one to attempt to make a compromise.

I really hate to put it in these terms because it is fraught with homophobic connotations that I certainly don’t intend but the short answer is that Sully is a pre-adolescent drama queen.

I call bullshit. I see no homophobic connotations in calling Sullivan a “pre-adolescent drama queen”. Look at all of his hand-wringing about how hard it is for him to be conservative, Catholic and gay. Only a drama queen of the first order would try to reconcile his sexuality with his desire to remain a member of a political movement and religion that despises him for it, anyone with an iota of common sense would leave the Catholic church for one that isn’t run by a homophobic Nazi and apologist for child molesters and wouldn’t be a conservative.

Listening to Sullivan bitch about the homophobia of the Catholic Church and conservatives is like listening to some Jewish guy in Berlin, ca. 1936, bitching about the Nazis and saying “I really like the way that Hitler has re-ignited a sense of pride in Germany and the German nationalist spirit. His public works programs are incredibly far-sighted, I for one can’t wait to buy one of those new ‘Volkswagen’ automobiles and drive on one of the new autobahns. I’m also glad that he’s building up our military. All in all I really like what he’s doing but I sure do wish he wasn’t into that ‘let’s kill all of the filthy Jew vermin’ thing. It makes it so hard for me to be a Nazi.”

@Sasha: I understand the logic, but I do not see what the payoff will be. The political results of Obama’s approach in the midterms was IMHO a disaster (even accounting for the mini disaster that was likely given the economy and the political cycle).

Eventually, Obama has to stand for something that is in the remote neighborhood of truth. I do not think he has done that. I see equivocation, and weasling, and spineless ineffectual preemptive surrender that gets nothing in return.

People do say they like Obama in the polls better than anyone, and far batter than the GOP. But it is hovering at 50/50, and how will the crucial deciding margin vote, as opposed to to what they will say about who the like in a poll?

What is the payoff in terms of good politics and good policy? I do not see any yet, or on the horizon?

By fifth column, I meant simply their ambivalence about the outcome of a war on which I believe the future of liberty hangs. Again, I retract nothing. But I am sorry that one sentence was not written more clearly to dispel any and all such doubts about its meaning. Writing 6,000 words under deadline in the heat of war can lead to occasional sentences whose meaning is open to misinterpretation.

What an incredible drama queen. He makes it sound as if he’s Edward R. Murrow reporting from the middle of the London Blitz, or Ernie Pyle filing dispatches from Okinawa. “Under deadline in the heat of war”. Good God! That’s one of the most ridiculous things ever written by a conservative, right up there with Confederate Wanker’s, post, the one he hastily retracted after being mercilessly ridiculed, about Sarah Palin’s experience as C in C of the Alaska National Guard or Stephen Den Best’s it’s the waiting that wears. post.

Here’s a question, given that Sullivan was so incredibly and disastrously wrong about Iraq why does he assume that anyone should listen to him now about the budget and the deficit? Or anything else that doesn’t involve the Pet Shop Boys, where I will say, as a fellow PSB fan*, that his judgment has been impeccable.

*And for the record I will have you know that there are thousands of straight Pet Shop Boys fans. Thousands of us. We are legion!

Sullivan nodded approvingly at Ryan’s plan too (in addition to Simpson Bowel Movement)??? Geez, he’s more hopelessly idiotic on this topic than I even realized. A developmentally-disabled hyena could crap out a better fiscal road map than Paul Ryan did.

The reason I would grant an exception for cap gains on a primary residence if rolled over into a new primary residence has to do with the fact that in many ways, a home is a very illiquid long term investment. So moving gains from one home into a new home is not unlike moving money from one bank account or mutual fund to another. But I do get and appreciate your point and it would be my preference to avoid slippery slopes. At the end of the day, the more exceptions you eliminate, the more you can lower overall rates and still generate the same amount of revenue.

As Galbraith said in one of his recent books, Predator State, the GOP, conservatives and economic elites “behind the curtain”, so to speak, stopped actually believing in free market fairies and fiscal conservatism a long time ago. Now they just use the talking points to rally enough voters to their cause while they’re stealing everything that’s not nailed down and engage in their own special brand of sockulism – the kind that funnels money to themselves and their interests.

The GOP does more or less the same thing with cultural wedges. Throw some rhetorical bones to get the bible thumpers scared and angry, do shit-ass nothing about said issues when in power aside from destined-to-fail symbolic votes. Accuse everyone else of being a secular fascist commie while out of power. Endless loop.

Of course, on either issue there are true believers who will push for real policy changes with real consequences. But by and large, as EDK said, it’s all a ruse.

If I can use a metaphor, the nation is like a house, a house you have your business in, and the recession a fire. The fire hasn’t destroyed the house and business but it has damaged them.

Fixing that damage is going to take money. So maybe you do cut back on some things. That lets you redirect money into repairs.

But that’s not enough. There’s structural damage that will require large outlays. If this isn’t dealt with the house will fall down and the business’ equipment will fail beyond repair.

So, you ask the bank to restructure your debts and perhaps extend more credit. Which they are likely to do since they don’t want to lose the money already invested. You charge your customers more. They’re agreeable because they need the services you provide.

Once things are repaired and the house is structurally sound again as well as your business now being able to serve more customers better, the debts can be repaid. Eventually you can lower costs a little.

But if the house falls down because you decided to go the ‘austerity’ route you don’t just get to be ‘austere’, you get to be very, very poor.

So, you ask the bank to restructure your debts and perhaps extend more credit. Which they are likely to do since they don’t want to lose the money already invested.

That second sentence should probably read: Which the banks are unlikely to do, because they sold off your loan to someone who repackaged it into a derivative, and now no one knows who the fuck owns your loan, but if you stop paying the mortgage they’ll sue your ass off.

True, true. It’s progress. I’m just familiar with a handful of former Republicans, or people still registered as R, but disgusted with the modern party, who for some reason think it’s utterly unfathomable to just become Democrats or admit to voting for them 90% of the time. It’s a pet peeve for me I guess.

But hell, despite voting party line for all statewide and national elections, I’m not registered as a Democrat either (I’m a hippie commie pinko in San Francisco, who is considerably to the left of the national party on many things…and I don’t like getting all the mail/email that finds its way to you).

“The same point can be made about “limited government.” It doesn’t mean anything, but is a platform for attacking those that can be demonized.”

The latest Welfare-Queens-in-Cadillacs are, of course, public sector workers, and Obot as I am, I still say screw Obama for freezing federal pay and buying into the “public sector workers are leeches” myth.

A few months back, a person living near me had doused themselves in kerosene, had a propane barbeque lighter in their hand, and was threatening to set fire to themselves.
Two arson inspectors tackled the person, risking their own lives, but knocking the lighter out of their hands.

Y’know what? I think they earned their 75% of peak salary retirement pensions, as has my kid’s grade teacher. As has the EPA official who helps keep our waters safe.

No, because our creditors know that all we need to do to pay them off is raise taxes or get out of this recession.

If they think that, then they are wrong. In fact, the Federal government’s ability to “pay” creditors is unlimited, and has nothing to do with taxes or getting out of the recession. It involves moving money from one account at the Fed to another, on a computer. Federal spending is not operationally constrained by availability of funds. The Feds have unlimited funds. Taxes aren’t used to pay for things, they are use to control the money supply, to heat up a cool economy (tax cuts) or cool an over-heated economy (tax increases). The fundamental lack of understanding about the mechanics of Federal spending is painfully wide-spread, and this lack of understanding allows discussion of debt and deficit to go to places it has no business being, such as the need to “reign in” so-called entitlements. Nonsense. As long as debt is issued in dollars, the Federal government will always be able to make full payment of any debt at any time. Now, the consequences of unlimited Federal spending are another matter. But “solvency” simply doesn’t enter into it.

But hell, despite voting party line for all statewide and national elections, I’m not registered as a Democrat either …

Heh, I’m almost exactly the opposite: I’m registered D, and almost always vote for Democrats, but — NY being a cross-endorsement state and me being considerably to the left of mainstream Dems — I almost always vote for them on the Working Families or Green ballot line instead of the Democratic line.

As a “Decline to State” voter, I look forward to voting in the GOP presidential primary on Super Tuesday. No idea whether I’ll try to push the craziest, easiest-for-Obama-to-crush candidate over the top, or vote for a comparatively sane jerk like Romney, just in case they actually beat Obama and we’re stuck with them for 4 years. It’ll likely depend on how things are going in a year.

The idea is to turn the functions of government into for profit businesses.

Social security is on the table because it is a potential boon to the financial industry. Have you ever heard anyone say the ss money will no longer be taken out of your check? Of course not. It will go to one of the large financial companies. Maybe if we are lucky we will even get to pick which one. SS and the public school system are a couple of the bigger plums in the privatization battle.

@DougJ®: we could save Billions in Medicare Health Costs if the Congresspeople and Obama would Stop caving into Big Pharma.

I have contacted the WH, Congress, Medicare and No One can explain to me why my mother’s Asthma Inhaler is priced at $320.00 for US Consumers, but the same inhaler is only $90 in Canada and less than $70 in France.

@catpal: What the Pharma people will tell you (I have a lot of friends, clients and acquaintances who work for major pharm companies in the Philly area where I live) is that the US pays a larger proportion of their R&D costs because no other countries are willing to bear a larger share of the burden. IOW, if US consumers/rx plans weren’t paying a premium, drug development would grind to a halt. This was Bush’s rationale for preventing Medicare patients from getting their drugs overseas.

“Writing 6,000 words under deadline in the heat of war can lead to occasional sentences whose meaning is open to misinterpretation.”

The most galling, and at the same time pathetic, thing about this pitiful excuse is Sullivan claiming that he ever did a single freaking thing “in the heat of war.” He’s a goddamned typist, for crying out loud. Nothing he wrote was written “in the heat of war” or anything even remotely like it.

I cannot for the life of me figure out why anyone reads him. He’s a self-aggrandizing blowhard.

I’m sick of people saying that inflation isn’t a problem. The only way the government has been able to say that inflation isn’t a problem is by leaving energy costs out of the calculation, and energy costs are rising rapidly, as are the costs of every freaking staple that I can think of. Try buying some vegetables, and watch you’re own eyes bug out.

It’s bullshit that “inflation is very low”, just plain bullshit.

And all this Chicken-shit Little horseshit about the deficit is the biggest bunch of horseshit I’ve seen in a long time, there is no reason that the deficit needs to be cut all-in-a-day. Anybody notice how much the Republicans efforts shrank, from their campaign ballyhoo to when the rubber meets the road. What a sack of shit.

Hope you’re still around to see this: Thanks for the chart. Can you tell me who created it? I’d like to pass it on to my Republican brothers who view the road map as the holy grail.

Also, thanks to whoever said in another thread that Charlie Rose sucked. You’re right! I watched Ryan interviewed on his show for a full hour and Rose didn’t question him at all on stuff like this. Rose did bring up Ryan’s plan to adjust the corporate tax rate to 0%, which was enough to make me dislike the plan, but this 50+ year slog to a balanced budget is real cause for alarm.

I remember all through the Bush years, my Republican brothers telling me that deficits don’t matter (at least they didn’t until November 2008); I wonder if now they’ll say balancing the budget isn’t important.

Fiscal responsibility now becomes as much an oxymoron as compassionate conservatism!

And there is another Big Lie lurking in all of this, the premise that a government should be run like a corporation. Bull-Shit. A government is NOT an organzation created to return profits to its investors, it is a different animal. And yes, the U.S. Government CAN survive while running massive deficits. Let’s get serious, folks, what this country needs right now is more jobs. Screw the deficit, please put aside your petty little bugabears like public employee unions and abortion providers. WE HAVE 9% UNEMPLOYMENT IN THIS COUNTRY. What part of “get the economy started” are you wingers not understanding?? And they ask me why I drink….

A lot of people don’t know much, especially about economics. they also don’t seem to remember. I’ve heard the SS is about to go bust etc my whole news aware life. I’ve noticed it never happens, even though its always about to. I’m afraid I no longer bother to check on if their is any validity to the latest scare, I just assume anyone who uses that or certain other arguments to support anything, is just a liar or fool.
Deficits were another old scare. I do think they were out of hand about the 70’s, and if we has continued to esculate more, we’d have had problems. Conventional wisdom was we needed huge cuts, we had big fights about actually doing those cuts, really didn’t do them because my pork is someone else’s critical project…time passed and somehow we got rid of the deficits, with just some reasonable changes, not draconian cuts.
The situation then was Vietnam and the cold war pay too much for every shiny high tech weapon. I was worried about the defict under Bush II because he insisted on having the war off book. Face the cost and tax for it, no problem, though ultimately we just need to get out. Obama understands I think, that the American public wasn’t quite ready to accept that, but they will be (IMO).
I know a lot of these fiscal myths have the look of being cynical manipulation, however the last few years, I’ve been thinking these politicians are actually ignorant. For instance, I don’t think Bush II would have gone into Iraq with such a dumb plan if he had understood it wasn’t going to work. I don’t think the republicans would have put ron Paul over economics nor come up with Paul Ryan’s plan if they had a clue about real economics. they do not know they are idiots is all I can conclude.

Thanks, I really appreciate the link. I am stunned that Ryan would have such damning evidence on his own site. It’s one thing to be arrogant enough to think it doesn’t matter, but to provide the undeniable evidence of the plan’s bogusness is something else. Talk about hubris!

Republicans know they can lie. The rank-and-file doesn’t care, and the media treats everything as an open controversy. (Here’s one of my favorite examples of that, right up there with “Shape of Earth: Views Differ,” http://www.washingtonpost.com/.....21_pf.html
“Lower Deficit Sparks Debate Over Tax Cuts’ Role”

“Federal revenue is lower today than it would have been without the tax cuts. There’s really no dispute among economists about that,” said Alan D. Viard, a former Bush White House economist now at the nonpartisan American Enterprise Institute. “It’s logically possible” that a tax cut could spur sufficient economic growth to pay for itself, Viard said. “But there’s no evidence that these tax cuts would come anywhere close to that.”

Great post, E.D. Truthfully, though, it’s the spineless Democrats that failed to pass the 250k+ tax hike before November that bear a lot of the blame. Even if you made it 500k, it would have been better than extending the Bush tax cuts until another presidential year.

Obama concedes far too much of the political dialog to the Republicans. Instead of focusing on job growth, he plays into the hands of cutting spending. He should use his bully pulpit to educate people as to how shit works and why it all needs to be paid for, instead of allowing people to continue the delusion that the government does nothing for them.

Trackbacks & Pingbacks

[…] have a tendency to flail a bit, though, without seeming grounded. E.D. Kain, over at balloonjuice, makes most of the case for me: What’s troubling to me about this is that I’m not sure Sullivan has made much of a case […]

[…] ED Kain: Is inflation out of control? No, not even close. Are our creditors closing our accounts? No, because our creditors know that all we need to do to pay them off is raise taxes or get out of this recession. When growth picks back up deficits will shrink. The deficit is not a problem in the first place. The whole thing is just a ruse. […]

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